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Recommendation 41: Establish a sustainment program baseline, implement key 

enablers of sustainment, elevate sustainment to equal standing with 

development and procurement, and improve the defense materiel enterprise 

focus on weapon system readiness.

Problem

Defense sustainment is a highly complex system of systems operating without fully coordinated 

requirements, under multiple commands and departments, receiving separate funding streams, often 

yielding disconnected decisions on total weapon system readiness, operating without sufficient data 

intelligence, with success graded on disconnected measures. The current state of readiness is driven by 

structure and strategy implications of decisions that focus on business concepts rather than the 

required outcome or customer measure of success or failure. Accountability is diffused to the point that

no single authority is responsible for material readiness to meet operational requirements.

DSS suffers from shortcomings that inhibit its performance:

§ There is no single document that governs sustainment costs, schedule, and performance 

throughout the lifecycle of a program (weapon system).

§ Sustainment leadership expertise on SAE staffs is not given the same credence as acquisition 

and procurement.

§ Issues in cost estimation, contracting, color of money, intellectual property (IP) and data rights, 

and metrics and data analytics impede sound sustainment decisions and timely actions.

§ The Defense Materiel Enterprise (DME) is not sufficiently focused on weapon system readiness.

Lack of Governance for Sustainment

During development and production, the APB constrains a program’s cost, schedule, and technical 

performance in terms of objectives and thresholds, but the APB provides little governance over the 

sustainment phase of a program’s lifecycle. The APB is the governing document from program start 

(Milestone B) through full-rate production (FRP), yet this critical document pertains to less than onethird of the program’s lifecycle costs and an even smaller portion of its life.1 The PM reports program 

progress toward the thresholds in the APB to the MDA, the SAE, and Congress. Exceeding APB 

thresholds can cause a statutory Nunn–McCurdy breach and possible program cancellation. The APB, 

with its consequences for failure, has proven to be a strong motivator for the DAS. There is no 

equivalent governing document for programs in sustainment. Once fielded, a weapon system is 

supported by multiple individual sustainment organizations, each providing singular product support 

elements. Because there is no coordinated and constrained governance for program sustainment, 

weapon system readiness has become the unpredictable outcome of an unconstrained and unfocused 

 

1 O&S costs are estimated to make up as much as 70 percent of the total lifecycle cost of DOD’s major weapon systems. S. Report 112-26, 

Report to Accompany the National Defense Authorization Act for Fiscal Year 2012, June 22, 2011, 136.
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defense sustainment system. As a result, PMs can find their programs affected by external budgetary 

and policy decisions with little opportunity to recover in a timely manner.

By DoD policy (DoDI 5000.2), PMs are responsible for cost, schedule, and performance management of 

their programs throughout the lifecycle. Although PMs can appropriately manage development and 

procurement during acquisition, they do not have the authority or capability to manage weapon 

system sustainment that delivers readiness. Instead, readiness is controlled by the sustainment silos

providing the product support elements within the DoD sustainment system. 

Standing of Sustainment

Sustainment does not stand on equal footing with development and procurement during the 

acquisition phase of a program. Responsibility and accountability for sustainment management do not 

converge on any single organization or individual focused on weapon system readiness. Sustainment 

costs are born out of design trades and decisions made during a program’s development and 

procurement. Sustainment funding has often been used as the PM’s management reserve (MR) to meet 

unplanned program issues during development and production, likely because deferment of product 

support activities is believed to be recoverable later in the program. Delays in planned product support 

investments affect reliability and maintainability and substantially increase support costs and affect

readiness. Requirements officials tend to focus more on traditional operational performance factors 

(i.e., speed, range, firepower) and less on sustainability (i.e., availability, reliability, maintainability, 

ownership costs). As a result, the latter often are subsumed by design trades and unforeseen cost 

increases during acquisition. 

Sustainment Activities Lack Modern Enablers

Planning and investments for sustainment activities are further inhibited by issues with funding types 

and obligation rates, procurement restrictions, cost modeling, IP and data rights, and lack of 

knowledge sharing across the enterprise. Cost estimating tools for total lifecycle costs have not evolved 

as much as those used to calculate development and production costs. As a result, models used to 

determine lifecycle costs do not produce reliable calculations. Unlike commercial counterparts, military 

systems in general lack sufficient data to support use of data analytics. Commercial entities warehouse 

system performance data and constantly analyze it looking for trends that can help predict when 

preventive maintenance can be done to avoid costly, sometimes catastrophic repairs. This same data 

can be used to support effective decision making throughout the system’s lifecycle.

Defense Materiel Enterprise Lacks Alignment

Readiness shortfalls can be seen in every Military Service. GAO reports for several years have 

documented critical readiness issues. Factors such as 17 years of war and the effects of the Budget 

Control Act of 2011 (resulting in sequestration) have led to the readiness state decried by the Service 

Vice Chiefs in their recent testimony before Congress.2

 

2 Statement of General Stephen W. Wilson, Vice Chief of Staff, U.S. Air Force, before the Senate Armed Services Subcommittee on 

Readiness and Management Support, February 14, 2018, accessed January 4, 2019, https://www.armedservices.senate.gov/imo/media/doc/Wilson_02-14-18.pdf. 
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Sustainment issues were highlighted by USD(A&S) Ellen Lord when she said, “sustainment costs for 

the F-35 are unaffordable.”3

In implementing the Goldwater–Nichols Act of 1986, development and procurement were separated 

from sustainment within DoD. One of the principle intents of this legislation was to clearly reassert 

civilian control of the military. An unintended consequence, however, was a disenfranchisement of the 

sustainment community.

Background

DoD must be able to immediately counter multipronged, sustained threats, yet the current logistics and 

sustainment system lacks the agility needed to do so. For decades, product support and sustainment 

management have been secondary to development and procurement within the DAS. Military systems 

have remained in service far longer than originally planned. Maintaining required spares for 

postproduction systems has been challenging as the government and industry have placed higher 

priority on new acquisitions. This lack of attention to product support and sustainment management 

has led to degraded weapon system readiness, rising sustainment costs, and insufficient supply 

support, and in parallel created suboptimal conditions in maintenance training, maintenance 

publications, provisioning, and repair capability.

DAS is focused on program development and procurement and is governed by the APB. Weapon

systems sustainment is funded and managed by the operational side of DoD. Separation of sustainment 

from development and procurement yields an approach to acquisition that focuses on technical 

solutions for a program, at the expense of balanced weapon systems sustainment throughout the 

lifecycle.

Existing regulations and policies establish reviews at each program milestone to ensure adherence to 

all aspects of defense acquisition. These reviews are supported by senior level staffs with expertise 

regarding the operational environment, requirements, and defense acquisition. Senior officials at levels 

equivalent to those for development and procurement—with the requisite expertise for product 

support management—are less represented. The system’s focus on development and procurement, 

with an attendant lack of appreciation, expertise, and accountability for weapon systems sustainment 

can preclude needed discussion on the supportability aspects of a system at these milestone reviews.

Program funding flows from Congress to the Military Services through a variety of appropriations and 

is channeled not only to the program but also to siloed organizations that will ultimately support the 

product. This partitioning of program sustainment funding leads to an incomplete accounting of 

 

2 Statement of Admiral William F. Moran, Vice Chief of Naval Operations, U.S. Navy, before the Senate Armed Services Subcommittee on 

Readiness, accessed January 4, 2019, https://www.armed-services.senate.gov/imo/media/doc/Moran_02-14-18.pdf. 2 Statement of General James C. McConville, Vice Chief of Staff, U.S. Army, before the Senate Armed Services Subcommittee on 

Readiness, accessed January 4, 2019, https://www.armed-services.senate.gov/imo/media/doc/McConville_02-14-18.pdf. 2 Statement of General Glen M. Walters, Assistant Commandant, U.S. Marine Corps, before the Senate Armed Services Subcommittee on

Readiness, accessed January 4, 2019, https://www.armed-services.senate.gov/imo/media/doc/Walters_02-14-18.pdf. 3 “Pentagon ‘can't afford the sustainment costs‘ on F-35, Lord says,” Aaron Mehta, Defense News, accessed March 29, 2018, 

https://www.defensenews.com/air/2018/02/01/pentagon-cant-afford-the-sustainment-costs-on-f-35-lord-says/. 
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critical resources such as manpower, training, spares, engineering, depot repair, and support 

equipment.

With each element of the sustainment organization devising, constructing, and implementing its own 

data and metrics, contradictory objectives can arise. The result is an incomplete set of metrics and an 

inability to use shared data visible to all stakeholders and to provide a reliable indication of 

sustainment health for weapon systems or the overall condition of the capability portfolio within which 

the platforms reside.

The DME consists of the materiel systems and supply commands and the DoD industrial base that 

comprise product support and sustainment management for DoD. Membership in this enterprise is not 

officially designated but is understood to mean everything and everyone associated with developing, 

procuring, storing, distributing, repairing, and supporting DoD’s warfighting capability. It includes 

contracted support but, historically, industrial base assessments have not included the contractor 

element. This approach presents an incomplete picture of the DME’s capacity.

Discussion

Several key shortcomings exist regarding sustainment management:

§ There is a lack of alignment and governance of program sustainment cost, schedule, and 

performance over the entire lifecycle.

§ The SAE staffs do not include sustainment professionals at an equivalent level of authority to 

the development and procurement senior staff and leadership.

§ Key enablers for modern sustainment are missing across the enterprise.

Establish a Sustainment Program Baseline

The PM’s focus during development and production is on meeting the APB’s cost, schedule, and 

performance thresholds. The effects of these shortfalls and trade-offs are not generally realized until 

years later, after the successful milestone decision and following the tenure of the PM who made the 

decision. The DAS focuses more on ensuring the program is meeting the requirements of the APB and 

less on the ability to sustain the system in the future. 

Warfighters receive weapon systems as a product of the DAS and depend on the sustainment system to 

provide the product support required for operational readiness of the weapon system. On average, 

approximately 72 percent of weapon systems lifecycle costs are in sustainment, yet there is no 

mechanism for coordinated governance of this critical operational program phase. The Section 809

Panel researched major defense programs and found the APB to be an effective tool for guiding, 

governing, and constraining the development and production of major weapon systems. 

During design, alternatives are weighed for performance and affordability. The PM must balance these 

factors and make decisions that will affect supportability and sustainment costs, both of which are 

outside the APB constraints. Small design trade-offs rarely affect total lifecycle costs enough to cause a 

program cost breach. Programs typically do not fail a milestone or breach the APB because of 

underfunded or delayed product support.
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During development and procurement, PSMs are planning for and engaged in activities that will 

provide for the effective sustainment of the system after fielding. Critical product support milestones 

occur after the APB’s final milestone review: the FRP decision. Critical sustainment milestones such as 

the material support date (MSD) and depot stand-up require planning, coordination, and funding years 

in advance of fielding, but they fall victim to design trades and budget reallocations to meet 

performance needs. Accordingly, early funding for sustainment investments is at risk because it is used 

as a source to fund development cost growth.

Despite efforts to increase visibility of design decisions affecting product support requirements, when 

technical or budgetary challenges arise during development and procurement, PMs have at times been 

forced to trade off programs’ future (outside the APB) to solve a current problem (inside the APB). The 

consequences of these deferrals and trade-offs are not realized until years later, after weapon systems 

are fielded and milestones completed. Decisions on program requirements, performance, and 

configurations made early in the acquisition process will largely determine a system’s Operating and 

Support (O&S) costs, and opportunities to reduce or avoid O&S costs diminish as a program advances 

through the lifecycle. 

KPPs and key system attributes (KSAs) for system lifecycle management are being included in program 

APBs; however, once a program has passed Operational Test and the FRP milestone decision, the APB 

is no longer a strong motivator for the PM or RM (A8/G8/N8). 

PMs are responsible for the program’s development and procurement and have the authority, 

autonomy, tools, and funding to manage to the parameters specified in the program’s APB, which is 

approved by the resource manager, MDA, and the PM. DAS is program-focused with the following 

characteristics:

§ It is a highly complex system of systems with one primary governing program document: the 

APB.

§ There are clearly defined and accountable officials: the PM, the MDA, and the resource 

manager.

§ Funding streams are directed to the program per APB thresholds.

§ Programs are strongly managed, funded, and measured to specific outcomes: Operational Test 

and Evaluation and FRP.

§ Program success is measured by meeting APB thresholds and achieving milestone approval.

§ The organizations’ objectives, metrics, and funding are focused on program success. 

In post-production, the PM and PSM are responsible for sustainment, but do not have sufficient 

authority, requirement, or funding to successfully manage the independent product support elements 

amongst the sustainment silos. With rare exception, there is actually no one individual truly 

responsible or empowered to manage a program’s sustainment for operational readiness; no single 
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official is held accountable for readiness shortcomings. Some of the challenges within the sustainment 

system include the following:

§ The system includes process-focused sustainment silos that are not program-focused.

§ It is a system that is not managed, funded, or measured by the outcome: program readiness.

§ There are multiple funding streams to independent organizations without regard for program 

readiness requirements.

§ Organization objectives, metrics, and funding are self-reflecting.

§ It is a highly complex system of systems consisting of disconnected sustainment silos.

§ There is no accountable official for programs’ readiness.

The following are significant challenges in the acquisition and sustainment systems:

4

§ Product support is a low priority and often becomes the funding source for unplanned program 

shortfalls, because there are no consequences for the PM or the program under the APB.

§ Supportability KPPs and KSAs are not well used during weapon system design and are not 

measured or evaluated during the sustainment phase.

§ The sustainment system is a collection of independent and specialized organizations that lack 

governance and accountability for the weapon systems readiness it supports. 

§ The acquisition system is program focused and governed by the APB.

Program officeslack appreciation of the effects of delaying sustainment planning. Issues that were 

consistently expressed by subject matter experts (SMEs) include the following:

§ Resources for product support and sustainment planning were not allocated and controlled 

early in the development process. 

§ Funding requirements for minimum capability for product support and maintenance were ill 

defined. 

§ Warfighters were not sufficiently engaged to address product support and sustainment 

requirements. 

§ Government and industry were not aligned regarding product support planning, incentives to 

improve reliability and maintainability, and sustainment. 

 

4 Information gathered during Section 809 Panel Sustainment Workshops, February–March 2018.
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SPB would improve the current shortcomings outlined in both the acquisition and sustainment systems 

that are affecting both operational costs and readiness. The SPB would be the governing document for 

product support and sustainment over the entire program lifecycle. The SPB would have the same 

three stakeholders as the APB: the PM, the resource sponsor, and the MDA—facilitating a long-term 

commitment that will enhance readiness.

The SPB in Development and Procurement 

The SPB would be generated during concept exploration and consider the key cost and readiness 

drivers that would influence trade-off considerations. During this early phase, sustainment goals could 

include annual operating costs, security, maintainability, transportability, mobility, availability, 

personnel, and the support and repair concepts. The APB would remain the key document during 

development and production. The importance of the SPB would increase over time. The relationship 

between SPB and APB is depicted notionally in Figure 2-16.

The SPB would mature with the program and product development. Sustainment performance 

requirements would start out as estimates and be further refined through the course of a program. As 

the strategy, costs, and performance parameters of the program’s plan for sustainment evolve, the SPB 

would capture the critical parameters to govern the program’s sustainment strategy after FRP. The 

budget and funding for all product support requirements and lifecycle costs would be identified in the 

SPB to reflect the strategy, plans, and milestones outlined in the lifecycle sustainment plan (LCSP). The 

critical product support milestones from the LCSP would be reflected in the SPB. The APB and SPB 

would be reviewed and approved at program acquisition milestones. 

Figure 2-16. Sustainment Program Baseline in the Acquisition Lifecycle
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The SPB During Sustainment and Disposal

As the program support concept matures, the SPB would provide the PM and PSM with the authority 

to govern the product support requirements, funding, and performance of the program in the 

sustainment system. As shown in the diagram above, the PM would develop service-level agreements 

(SLAs) with the product support providers. SLAs would be binding agreements between the 

organizations outlining requirements, funding, and performance outcomes to achieve the thresholds in 

the SPB. SLAs should be updated annually with 5-year forecasts.

After FRP, the SPB would be updated, reviewed, and approved biennially for the remainder of the 

program’s lifecycle by the PM, MDA, and resource sponsor at the sustainment program milestone. 

A breach to the SPB thresholds for cost, schedule, or performance would be reported to one level above 

the stakeholders within 30 days.

The SPB would capitalize the value of early sustainment planning, devise budgets to support the 

necessary planning, and integrate the cost, performance, and accountability of a program throughout 

the lifecycle.

Incorporating both the APB and SPB into program development and production provides the needed 

transparency, outcome-based results, and full accountability for the PM to manage the program across 

the entire lifecycle. This approach is applicable in the current PEO structure as well as the portfolio 

management construct.

Although creation of this document adds to the program office workload, the value it adds in 

establishing early sustainment performance goals and protecting sustainment funding offsets the 

additional effort. Because sustainment funds are often used as a source of MR, the SPB may also be 

viewed as limiting the PM’s flexibility to move funding to address emerging issues. The document 

would force a contract with the key program stakeholders that would prevent outside agencies from 

raiding program funding. By ensuring the stakeholder network is involved in funding allocation, the 

program would also benefit from added influence and support to replace reallocated sustainment 

funding should it be necessary to move those funds to address an emergent development or 

production need.

Establishing and maintaining the SPB would improve governance and management of programs’

product support and sustainment by doing the following:

§ Developing sustainment performance requirements that influence design.

§ Balancing trade-offs between development, production, and sustainment.

§ Protecting requirements and funding that impact future readiness and sustainment costs

§ Empowering the PM to manage sustainment to the SPB cost, schedule, and performance 

thresholds through SLAs with product support providers.

§ Enabling and instituting governance and accountability of weapon system sustainment and 

readiness. 
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Elevate Sustainment

Better management of product support should start with mandating that the PSM be a direct report to 

the PM. Establishing a PSM position was intended to bring product support and sustainment 

experience and expertise to the upper management levels of the program office. Although the PSM 

roles and responsibilities are clearly defined, no specific resources are identified to support these 

efforts. Having the PSM as a direct report to the PM would signal to the entire program office the 

importance placed on sustainment management.

Elevating sustainment would also require a larger and more experienced staff within the PAE 

organization. The deputy PAE for sustainment would lead a team of product support experts who 

would provide guidance for individual programs and oversight of the entire portfolio. They would be 

the first level advisors for the PAE making trade-off decisions to achieve portfolio objectives.

At the SAE level, a deputy for sustainment would lead senior product support and sustainment experts 

who would be advocates for successful sustainment decisions throughout the acquisition process. The 

sustainment deputy would guide the Military Services’ strategy and governance of sustainment and 

also advise the SAE on sustainment. They would also provide inputs for both the PAE and ECP 

regarding sustainment.

Key Enablers for Modern Sustainment are Missing

A number of key enablers are absent from the sustainment system:

§ There is no stable funding for sustainment planning and execution that is budgeted at the 

program level and then directly controlled by the PSM.

§ Contractual vehicles do not incentivize key partners to meet long-term sustainment goals.

§ IP and data rights are not appropriately addressed.

§ O&S cost modeling is inadequate. 

PMs have historically been forced to make design trades-offs, favoring operational requirements early 

in a program’s lifecycle and consuming resources that would otherwise have been used to cover 

sustainment needs. PMs favor technical requirements over sustainment planning in the early stages of 

a program. Technical issues are not clearly understood until design work can be completed and 

sustainment planning impacts will not be seen until years later. There are no sustainment requirements 

in either the APB or the acquisition strategy that must be fulfilled prior to each milestone decision. 

The PSM must compete for program funding to achieve appropriate levels of sustainment planning 

and performance. Funding is often provided only in the year of execution, further hampering the 

PSM’s ability to establish long-term strategies to improve sustainment performance or incentivize 

lifecycle cost reductions.

Sustainment Funding

Sustainment is often allocated Operations and Maintenance (O&M) funding that expires each year. 

Solving obsolescence issues, particularly for avionics parts, is constrained by real or perceived 
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regulations or polices that govern the funding source. With rapid technology advances, the capability 

of replacement avionics, as well as other categories of components, usually exceeds that of the item it is 

replacing. Because replacement technology typically increases speed, throughput, or some other aspect 

of performance, it is perceived as adding functionality. This perception often drives procuring agencies 

to determine that R&D funds are required to counter the obsolescence, adding unnecessary time and 

complexity to the sustainment process. Without budgeted resources, identifying funding to correct 

obsolescence becomes exacerbated by short response time.

Interpretation of the regulations and policies governing obsolescence has been incorrect.

5 A research 

project initiated by DAU, in conjunction with Hacking 4 Defense (H4D), showed that procurement 

activities were using an interpretation fostered by an incorrect application of the Financial Accounting 

Regulation regarding capability improvements resulting from redesigns due to obsolescence issues. 

Interviews with more than 100 individuals throughout the acquisition community revealed that an 

incorrect interpretation had been circulated throughout DoD. DAU and H4D investigated the 

regulations and policies, finding them essentially silent on this matter, and recommended a new 

training element quickly disseminate the correct information and updates to the regulation.

The variety of funding sources (commonly called color of money issues) and expiration periods applied

create sustainment issues as well. An example of why the potential for confusion exists can be found in 

funding for spare parts. Spare parts may be considered provisioning, replenishment, depot-level repair, 

or obsolescence. Spares for provisioning may be purchased through a program office with procurement 

funds for initial sparing. Replenishment may constitute additional purchase of spares or depot-level 

repair may be executed to support replacement of worn or damaged parts. Obsolescence may result 

from failure in reliability or diminishing manufacturing sources. Each of these possibilities could 

require funding by a different appropriation, with each funding source governed by a different 

expiration period. 

Financial Management Regulations (FMRs) can be confusing, arcane, and subject to interpretation, as in 

the obsolescence example above. The result is delayed decision making and lack of agile support to 

warfighters. Asset visibility is also affected. Long-term contracting is impeded, which inhibits depot 

maintenance organizations (both organic and commercial) from developing well established 

relationships with suppliers.

IP and Data Rights

Program management has not addressed the IP issue in sustainment adequately.

6 PMs and PSMs share 

responsibility for ensuring weapon systems receive appropriate and competitive component repair. To 

maintain competition throughout the lifecycle, data rights and IP—as applicable to both hardware and 

software—must be addressed up front. Obtaining IP and data rights has become a complex issue for 

most major programs, resulting in dissatisfaction within both the organic and commercial depot 

 

5 Information gathered during Section 809 Panel Sustainment Workshops, February–March 2018. 6 Richard Van Atta et al., Department of Defense Access to Intellectual Property for Weapon Systems Sustainment, IDA Paper P-8266, 

May 2017, Institute for Defense Analysis (IDA), accessed May 30, 2018, 

https://www.ida.org//idamedia/Corporate/Files/Publications/IDA_Documents/SFRD/2017/P-8266.pdf. 
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organizations. Data rights and IP should be made available when needed, where needed, and for the 

specific purpose needed while also protecting the IP and data rights of industry partners.

Software Sustainment

Organic software sustainment is determined by platform requirements. There is no organic software 

sustainment strategy today, and considering the rapidly evolving nature of software development and

maintenance tools, the government needs to increase attention here. The complexity of acquiring data 

and data rights regarding commercial products, incorporated into either purpose-built or hybrid 

platforms, requires development of policy, regulations, and statutes. The government should leverage 

the strengths of both organic and commercial software organizations in this effort.

Depot Maintenance

Little knowledge sharing occurs among the Military Services and between organic depot organizations 

and commercial maintenance, repair and operations (MRO) facilities. Differences in execution of 

sustainment support among the Military Services do not promote active sharing of ideas, methods, and 

technologies. The degree of sharing is driven by personal relationships. Organic depots and 

commercial MRO facilities consider themselves competitors; consequently, knowledge sharing 

regarding repair methods, tooling concepts, and processes is rare. Successful programs find ways to 

overcome these obstacles, but responsiveness was forced by the program office rather than incentivized 

through appropriate contract vehicles. An example of this is the F-22 program for which specific 

expertise to support depot level repair at an organic depot is supported by manpower detailed by the 

original equipment manufacturer (OEM). 

Metrics and Data Analytics

SMEs have identified several shortfalls in metrics:7

§ Tools to enable model-based engineering for sustainment are needed.

§ Total lifecycle analysis tools are needed, such as better tools to model reliability and 

maintainability, determine optimum product support, forecast demand profile, and perform 

predictive manpower analysis.

§ Model-based engineering is used extensively during development. Modeling of sustainment to 

include such items as transportation, deployed repair capability, and manpower are seldom 

used. 

Reliability estimates are calculated during proposal development and are measured during technical 

maturation. Actual reliability seen in combat operations is often substantially different from the early 

estimates or even measurements taken in a laboratory environment. Maintainability is judged during 

technical evaluation through a maintenance demonstration. Results may not be representative of the 

final delivered product. Tools that allow modeling of reliability and maintainability characteristics 

would allow identification of the effects of early development decisions. For example, a model that 

included the required maintenance-free operation time following deployment would drive reliability 

 

7 Information gathered during Section 809 Panel Sustainment Workshops, February–March 2018.
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and provide assessment of the time required to deliver deployed repair capability to a combat theater 

of operations. Predictive manpower analysis tools, applied early in the development phase, would 

provide lead time for training and documentation requirements to be established and appropriate 

planning, budgeting, and forecasting applied.

Demand signals provided to repair activities (whether organic or commercial) drive investments in 

training, tooling, manpower, and spare parts availability. SMEs from both organic facilities and 

industry spoke about the demand signal quality, which can impede execution of depot-level repairable 

(DLR) actions.8 Tools providing visibility of demand signal to all stakeholders are not in place. Reports 

regarding metrics within the organic industrial base are replete with recommendations and suggestions 

for improvements. Although some recommendations and suggestions have been adopted, the current 

readiness state indicates that more can be done.

Use of predictive analytic tools is in its infancy within DoD but widely used by industry. Data from 

each Military Service is controlled, stored, and manipulated internally. Each DME element has its own 

information technology department, but there has not been a requirement for them to be interoperable 

or for the data to be collectively warehoused. Efforts to compile all the data, collectively analyze it, and 

make decisions at the DoD level requires numerous data calls, manual information transmission, and 

considerable time. 

O&S costs equate to 42 percent of the FY 2019 DoD budget request, more than double the investment in 

research and procurement. Whether funding is being applied correctly must often go unanswered for 

lack of effective data analytics.

Improve Focus of Defense Materiel Enterprise on Weapon System Readiness

The DME’s lack of focus regarding weapon system readiness is manifested in four key areas:9

§ Product support provided by individual, internally focused organizations in the DME to 

weapon system readiness does not receive the attention or visibility needed. 

§ PMs have little insight regarding decisions made by suppliers of the various product support 

elements and have little opportunity to influence these decisions or to assess the impacts in a 

timely manner.

§ Total industrial capacity and capability has not been assessed in many years.

§ Overall depot maintenance strategy is not aligned to the NDS.

Product Support

Product support organizations in DoD are focused on single elements such as manpower, training, 

systems engineering, mission software, depot repair, spares and consumables, or technical 

publications, as shown below (see Figure 2-17). Operating in sustainment silos, these organizations 

 

8 Ibid.

9 Ibid.
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tend to make independent decisions based on anticipated outcomes beneficial to the organization 

without regard for requirements, budgets, funding levels, or readiness effects. The system lacks a 

controlling mechanism for the required output—weapon system readiness. When isolated mandates, 

such as military end strength, are issued, the down-stream effects of such decisions are felt throughout 

the defense sustainment system for years. Weapon system sustainment requires a system-of-systems 

approach to plan, manage, and control the interdependencies of the product support elements 

contributing to a program readiness. Figure 2-17 depicts the product support elements, each of which is 

funded differently, operates on metrics with little or no direct correlation to readiness, and is internally 

focused rather than outcome focused.

Figure 2-17. Product Support Elements

SMEs repeatedly described situations in which organizations within the integrated product support 

elements either executed or failed to execute decisions based solely on their own internal policies, 

direction, or even personal biases without regard for the effect on readiness.10 An example is the 

anecdotal information provided by one PSM who stated that a supply-chain element failed to initiate a 

contract for replacement spares for an item that was rendering a number of his platforms non-mission 

capable (NMC).

11 When he investigated, he determined that a key contract was being withheld over a 

negotiation on allowable profit regarding a 1 percent difference in price for a piece-part worth less than 

$1,000. Further research found a number of platforms had been declared NMC awaiting resolution of a 

price difference measured in tens of dollars. This put weapon system readiness in jeopardy when a 

premium to a contractor or supplier could have quickly resolved the problem and met warfighter 

needs. (See the panel’s recommendation on value analysis in Recommendation 38.)

 

10 Ibid.

11 Ibid.
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Program Manager Insight Regarding Product Support

One stakeholder held up the USAF model as a positive example of product support.12 This model

depicted a feedback mechanism from the sustainment enterprise to the Program Management Office 

(PMO). The USAF model resulted from a reorganization that provides periodic program reviews by all 

levels of the acquisition system—from the SAE, PEO, PMO, Systems Commands, and warfighters. 

Other stakeholders indicated the USAF model should be replicated in the other Military Services.13

A governance process that is inclusive of stakeholders, is transparent in intent and purpose, and allows 

for Military Service-level redistribution of funds to address emerging needs while ensuring program 

needs are considered would be a step toward better sustainment management. Failure to better manage 

and invest in product support has a two-fold effect: It increases future operations costs and reduces 

funds available to invest in new capabilities and recapitalization. 

Total Industrial Capacity and Capability

With respect to maintenance, total industrial capacity of the United States has not been accurately 

assessed in many years. Depot maintenance capacity, to include both commercial and organic 

organizations, is not aligned to the NDS because there has been no requirement to do so. Organic depot 

maintenance organizations are generally aligned to the needs of the Military Service they support, 

except in rare cases in which Military Services have agreed to satisfy joint needs. Commercial depot 

maintenance organizations are profit motivated but have more flexibility to respond to changing 

requirements. Lack of a complete industrial capability and capacity assessment and determination of 

overall required capacity has resulted in duplication of capability in some areas and gaps in others. For 

example, each Military Service addresses the issue of diminishing manufacturing sources and material 

shortages (DMSMS). The Army and Air Force their own respective unique software tools. The Navy 

has distributed capability across five different organizations.

Depot Maintenance Strategy

10 U.S.C. § 2464 requires DoD to maintain core depot capabilities for key weapon systems sufficient to 

support expansion for wartime operations. 10 U.S.C. § 2466 places a 50 percent limitation on the funds 

made available to Military Services or Defense Agencies that can be used to contract for performance 

by nongovernment personnel, commonly known as the 50/50 rule. Up to 50 percent of the total depot 

maintenance budget is thus an entitlement for the government maintenance organizations. Throughout 

its history, 10 U.S.C. § 2466 has been changed several times to ensure a balance between organic depot 

funding and contracted performance to optimize efficiency of the overall repair network.

Organic depot maintenance remains an important capability. During World War II, IP developed by 

one company was often handed over to another company to enable increased production rates. 

Modern weapons systems have become so complex that rapidly increasing productions rates in this 

manner would be nearly impossible for many reasons, including time. International conflicts are now 

more often a come as you are evolution. Organic depot maintenance has evolved from a manufacturing 

 

12 Ibid.

13 Ibid.
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capability to MRO capability. Title 10 requires an organic depot capability to provide surge capacity 

but primarily for component repair to support already fielded equipment.

Some older industrial capabilities are not available through industry or are sufficiently critical that a 

government source must be maintained. For example, the major producer of gun tubes for cannons, 

mortars, and tanks for the Army is Watervliet Arsenal. Similarly, the primary producer of arresting 

gear for use aboard Navy aircraft carriers is at Lakehurst, NJ. 

Conclusions

DAS is focused on the development and production of weapon systems and governed by the APB. This 

system has governance and controls to manage the cost, schedule, and performance required. The 

sustainment of DoD’s weapon systems, which accounts for more than 70 percent of weapon system 

lifecycle costs, lacks the required governance and accountability, and is a system of independently 

operated silos that compete for limited dollars. DoD’s sustainment system lacks the alignment of 

investments, enablers, data, metrics, and management to enable affordable and effective weapon 

system readiness. 

Implement a Sustainment Program Baseline 

Improving weapon system readiness will require implementing the alignment, governance, and 

visibility of the sustainment costs, requirements, and funding over the entire lifecycle, to enable the 

development, execution, and support of the system’s operational readiness, directly managed by the 

PM and the PSM as approved by the SPB. The PM must be aware of and able to directly influence 

decisions regarding the program by other elements of the Defense Materiel Enterprise. To address this 

issue, the following should occur: 

§ Establish the PM as the single responsible authority for ensuring material readiness to the 

established requirements in the SPB.

§ Require the SPB for all program acquisition milestones and biannually after Milestone C.

§ Align funding, requirements and expectations for provider organizations to execute the 

sustainment strategy to improve, obtain, and monitor weapon system readiness through service 

provider agreements.

Elevate Sustainment to an Equal Standing with Development and Procurement

Changes in the existing organizational structures are needed throughout DAS to enable sustainment to 

gain the visibility and stature afforded to development and procurement. Such change will require 

strengthening the authority of sustainment officials from the SAE to the program office. 

The PSM needs to be a direct report to the PM and part of the PAE’s organization. Empowerment and 

appropriate incentives for the PM and the PSM can be accomplished by making changes that provide 

stable funding and having the PSM become a direct report to the PM. This action would highlight the 

importance of sustainment management to the entire program office. 

Equally important is having sufficient expertise and authority in the PAE and SAE organizations to

ensure implications of program and enterprise decisions that will affect sustainment of a program 
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going through decision reviews will be understood. To address this concern, the following should 

occur:

§ Establish sufficient expertise on the PAE staff to facilitate and govern product support and 

sustainment decisions across the portfolio.

§ Establish expertise on the SAE staffs with the necessary knowledge and sufficient authority to 

provide inputs for both portfolio- and enterprise-level decisions regarding sustainment within 

the Military Services and across DoD.

Key Enablers are Required to Improve Sustainment Management

Enablers for sustainment management are needed to improve the information, modeling, and metrics 

used across the defense enterprise to manage this extremely complex and costly system. To address 

this concern, the following should occur:

§ Implement improvements in cost modeling for sustainment. Decisions made within the first 30 

percent of development and procurement determine 70 percent of the lifecycle cost. 

Establishing a SPB early and allowing the PSM to drive sustainment costs through reliability 

and maintainability improvements during design will create long-term benefits.

§ Prescribe and allow programs to budget for obsolescence. Tools for predicting obsolescence, 

particularly in electronic components, are readily available. Ensuring programs have properly 

estimated and budgeted for obsolescence management will enable proactive planning and 

response to this issue faced by all programs.

§ Promote knowledge sharing among organic depot maintenance activities and commercial MRO 

activities.

§ Clarify statutes, regulations, and policies regarding sustainment funding. Training related to 

such clarifications will be needed to improve standardization, promote flexibility in 

interpretation, and provide more agile sustainment response to warfighters.

§ Develop and use sustainment metrics and data analytics for cost estimating, modeling, and 

performance.

Align the DME to Strategic Weapon System Readiness

Current material readiness and sustainment costs are driven by the DME’s structure and strategy 

decisions without established responsibility and accountability for desired outcome tied to readiness 

requirements. Changes to both the structure and strategy should be focused on increasing agility and 

flexibility of the system to provide better warfighter support. To address this concern, the following 

should occur:

§ Develop an integrated national industrial-base strategy, encompassing both organic and 

commercial organizations, aligned with current NDS.
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§ Conduct an end-to-end material readiness process assessment to provide alternatives to 

improve the effectiveness, efficiency, and affordability of the overall system.

§ Make organic depot determinations within the industrial base (organic and commercial), 

focused on warfighting requirements.

§ Develop a DoD vision for the industrial base regarding organic and commercial technology to 

take best advantage of all capabilities.

§ Develop a strategy for organic software engineering capability and requirements.

Implementation

Legislative Branch

§ Direct DoD to implement an SPB to govern product support cost, schedule, and performance of 

the weapon system throughout the lifecycle. Require the development of an SPB—concurrent 

with the development of the APB—that is updated and approved at each program acquisition 

milestone and then biennially following FRP at the sustainment milestone reviews.

§ Direct DoD to update and strengthen lifecycle cost estimating methodologies to support 

development of the SPB. Obsolescence affects all programs; proactive planning and requiring 

programs to budget for obsolescence would improve readiness. 

§ Direct DoD to propose specific changes to statutes to clarify sustainment funding that are 

needed to improve standardization, promote flexibility in interpretation, and provide more 

agile sustainment response to warfighters. Congress should also direct DoD to implement 

changes to update regulations and policies and conduct training related to the changes to 

statutes. 

§ Direct DoD to conduct and report to the congressional defense committees, an assessment of the 

defense sustainment enterprise to include balance of leadership attention among acquisition 

and sustainment, organizational structures, national industrial base, and alignment of DME to 

weapon system readiness and support of the NDS. The assessment should include the 

following: end-to-end material readiness process assessment to provide alternatives to improve 

the effectiveness, efficiency, and affordability of the overall system. The industrial base strategy 

should do the following:

- Encompass both organic and commercial organizations in the national industrial base.

o Right size and composition of the industrial base regarding organic and commercial 

technology to take best advantage of all capabilities in view of the NDS.

- Focus depot determinations within the industrial base (organic and commercial) on 

warfighting requirements.

- Tie accountability for outcome to readiness requirements. 

- Maintain DME agility and flexibility for warfighter support. 

- Include other activities and/or entities as identified to provide a full and accurate 

assessment of the defense sustainment enterprise. 
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Executive Branch

§ Elevate sustainment to an equal standing with development and procurement by adequately 

funding, manning, and overseeing sustainment in accordance with the recommendations of the 

panel.

§ Improve sustainment management through key enablers.

- Improve the data and information, modeling, and metrics across the defense sustainment 

enterprise to manage this extremely complex and costly capability. To address this concern, 

the following focus areas require attention:

o Employ cost modeling for sustainment being mindful of the fact that decisions made 

within the first 30 percent of development and procurement determine 70 percent of the 

lifecycle cost.

o Develop a strategy for organic software engineering capability and requirements.

o Create long-term benefits by ensuring the PSM drives sustainment costs through 

reliability and maintainability improvements during design.

o Establish an SPB early.

o Share knowledge promptly among organic depot maintenance activities and commercial 

MRO activities.

o Maintain sustainment metrics and data analytics for cost estimating, modeling, and 

performance.

§ Address the following in DoD and Military Service/Agency directives and instructions:

- Policies and processes to implement enhanced sustainment management per statutory 

requirements.

- SPB as the baseline requirements document for funding and staffing sustainment activities. 

- Sustainment billet structures across DoD appropriate to challenges of the sustainment 

enterprise.

- Sufficient expertise on the PAE staff for product support and sustainment.

- Management of programs to the thresholds in the SPB and development of service provider 

agreements with major stakeholders.

- Empowerment of the PM, with direct input from the PSM, to manage the sustainment of the 

program from cradle to grave, through the SPB. 

- Situating the PSM as a direct report to the PM. 

§ Empower the PSM to develop and execute the lifecycle sustainment plan to meet the cost, 

schedule, and performance requirements of the SPB.

§ Incorporate above Executive Implementation recommendations in revision to DoDD 5000.01, 

The Defense Acquisition System and operating instructions. 

Implications for Other Agencies

§ There are no cross-agency implications for this recommendation.